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Reservation Wages of First and Second Generation Migrants

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Author Info

  • Constant, Amelie F.

    ()
    (George Washington University, Temple University)

  • Krause, Annabelle

    ()
    (IZA)

  • Rinne, Ulf

    ()
    (IZA)

  • Zimmermann, Klaus F.

    ()
    (IZA and University of Bonn)

Abstract

This paper analyzes the reservation wages of first and second generation migrants. Based on recently collected and rich survey data of a representative inflow sample into unemployment in Germany, we empirically test the hypothesis that reservation wages increase from first to second generation migrants. Two extensions of the basic job search model, namely an unknown wage offer distribution and different reference standards, provide theoretical justifications for this conjecture. In both extensions, changing frames of reference are identified as a channel through which the phenomenon of increasing reservation wages may arise. In as far as language skills or self-evaluated returns to characteristics reflect a person's frames of reference, we find empirical support for this mechanism to be present.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5396.

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Length: 36 pages
Date of creation: Dec 2010
Date of revision:
Handle: RePEc:iza:izadps:dp5396

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Keywords: migration; ethnic identity; ethnosizer; Germany; unemployment; job search; reservation wages;

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References

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Citations

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Cited by:
  1. Arni, Patrick & Caliendo, Marco & Künn, Steffen & Zimmermann, Klaus F., 2014. "The IZA Evaluation Dataset Survey: A Scientific Use File," IZA Discussion Papers 7971, Institute for the Study of Labor (IZA).
  2. Bergemann, Annette & Caliendo, Marco & van den Berg, Gerard J. & Zimmermann, Klaus F., 2011. "The Threat Effect of Participation in Active Labor Market Programs on Job Search Behavior of Migrants in Germany," IZA Discussion Papers 5485, Institute for the Study of Labor (IZA).
  3. Rinne, Ulf & Schüller, Simone & Zimmermann, Klaus F., 2011. "Ethnische Vielfalt und Arbeitsmarkterfolg (Ethnic diversity and labor market success)," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 44(1/2), pages 81-89.
  4. Anthony Edo, 2013. "The Impact of Immigration on Native Wages and Employment," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00881131, HAL.
  5. Constant, Amelie F. & Tien, Bienvenue N., 2011. "Report No. 41: Germany's Immigration Policy and Labor Shortages," IZA Research Reports 41, Institute for the Study of Labor (IZA).
  6. Amelie Constant & Martin Kahanec & Ulf Rinne & Klaus F. Zimmermann, 2009. "Ethnicity, Job Search and Labor Market Reintegration of the Unemployed," Discussion Papers of DIW Berlin 963, DIW Berlin, German Institute for Economic Research.
  7. Humpert, Stephan & Pfeifer, Christian, 2013. "Explaining age and gender differences in employment rates : a labor supply side perspective," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 46(1), pages 1-17.
  8. Anthony Edo, 2013. "The Impact of Immigration on Native Wages and Employment," Documents de travail du Centre d'Economie de la Sorbonne 13064, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.

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